September 8, 2014

One of my weekly “must-reads” includes the Monday Morning Memo from the “Wizard of Ads” marketing guru Roy H. Williams. His weekly thoughts offer insight into the world of advertising and the human condition. Often illuminating, the Wizard delves into the more qualitative world of the psyche (and relationship marketing) rather than the data-driven quantitative marketing formats that tend to dominate mass-marketers and require a greater working knowledge of excel than I can to know. Both methods offer a version of “truth” for those seeking to communicate their message and meet their sales goals.

Today, the Wizard offered up a challenge to the concept of teamwork declaring it, with a certain level of understatement, “highly overrated.” This concept focuses on the nature of the creative person, the artist, as the driver of business, communication, and human development. Williams argues that “every bureaucracy begins as a well intentioned committee.” In reading today, I thought about how this concept engages in the cooperative model. Cooperate literally means “work together” and quite often that means collective action, collective decision making, and, yes, committees and teams.

At heart of this discussion lies the tension between individual action and community needs. Williams argues that is the allure of tribalism, but I see it more as a necessity of community survival. Subscribing to the “Great Man” theory of community that Williams appears to do ignores a lot of reality. Great Men rarely become “great” without a lot of help. Even the individuals that he mentions as “tribal leaders” only managed to attain those roles through the collective action of a larger community–often it is because people are acting on their own interests that have little to do with the goals of the “great man”.

So perhaps the real question isn’t about teamwork vs. individual action, but about the role of leadership in organizations. In the cooperative model, we value self-help and self-responsibility but temper those individualistic ideals with the values of solidarity, equity, equality, and democracy. This enhances the community (or the tribe) while also helping to create leadership responsible to the stakeholders (both the members of the cooperative and the larger community). This allows the expression of individual creativity (and allows people to be creative by removing barriers that the title “leadership” imposes) yet may also act as a brake on the more destructive aspects of personality cults.

Yes, poorly managed committees and teams can be incredibly oppressive to the individual and cooperative spirit along with being a massive waste of time and money. However, committees and teams focused and trained in creative expression and communication can create a synergy of those same individual creative forces that can truly create sums bigger than the whole. It is a temptation to seek the isolation of the ego that softly coos to us “how can I soar like an eagle when I am weighed down by turkeys”, but ideas only go into the ether without committed people ready to implement them. To make a vision become more than a dream requires buy-in and support and that either means finding enough people who think exactly the same way or forming a consensus.

The role of a leader in a cooperative should be to help people dream and express their vision while creating a culture of a learning organization so that the competing visions work together instead of against one another. “Leaders” don’t create mass movements. Mass movements create leaders and those leaders change depending on the needs of the movement.

There has been a lot of discussion of late regarding the so-called “sharing economy”. This phrase refers, generally, to organizations such as Uber, Lyft, AirBnB, and others that provide an on-line broker service so that people can monetize practically everything in their life. The term sharing economy is a great marketing ploy to suggest that this practice engages the voluntary actions of the participants who just want to earn a little extra money from their assets. On the face of it, it makes a lot of sense–if someone wants to pay me $10 bucks to use the lawnmower that I am not using, why not? If I can give someone a ride to work on my way to work and it pays for my gas, that is a great deal and I am helping out a fellow human who may need that ride due to lack of access to public transportation or a personal vehicle. However, that isn’t what these organizations are really doing and I would argue that the the people engaging in it do so because they are rather desperate in a late-stage capitalist economy taking full advantage of having largely crushed the labor unions.

The New York Times recently ran a “balanced” article chronicling the days of a couple of workers. In this article, the workers seem content and like the variety and hustle-and-bustle of the life of managing multiple phone apps, 10-14 hour days, and not being able to spend time with their family to earn about $10 an hour after self-employment taxes and expenses. They would probably be better off with a menial minimum wage job, but that would limit their total hours or require them to maintain multiple jobs such as the women who recently succumbed to fumes and died while taking a rest break in her car. The non-sharing economy doesn’t have a lot to offer to workers today either.

Maureen Conway, of the Aspen Institute, sums up the reality of this new effort by capitalists to avoid any responsibility to the communities from which they extract wealth:

“In the end, the sharing economy is nice words for what is really more of the same. More money going to business profits held by a few, and less money going to the labor income that is the primary means of support for most Americans. What we need is a sharing economy in which working people share in the wealth that their labor creates. Unfortunately, this version of a sharing economy does not promise that. “

The “sharing economy” is about workers “sharing” their labor and capital with venture capitalists for a percentage while also accepting 100% of the risk (expenses, accidents, taxes, etc). This isn’t a new effort. Last week, (August 27, 2014), a Federal Court finally ruled in a long-running dispute that FedEx improperly classified many of its employees as “independent contractors”. FedEx has tried to claim that its drivers were independent contractors mainly because it has shifted most of the expenses on to them (they have to buy the truck, rent the equipment to track deliveries, etc). I remember one argument that FedEx made in a similar case that is still to be decided that the drivers could use the truck to run other deliveries provided that they removed all the FedEx decals first and then reapplied them in time for their next shift. Seriously. Had FedEx won this case (and it might still go to the Supreme Court), it would have been a watershed moment that would essentially bring us back to the early days of 1800. What company wouldn’t love to reclassify its workers as independent contractors and immediately save on payroll taxes plus other items? However, that is essentially what the sharing economy is hoping to do.

There is a real sharing economy, however. It has existed (as an on-going concern) since 1844 and in different forms for many years before that such as the first mutual insurance company founded by Benjamin Franklin in 1752. Cooperation brings people together to share their capital for the common good. Instead of groups such as Uber or AirBnB in which people provide their labor and capital to provide wealth for a third party, the labor and capital provided to a cooperative benefits the users of the cooperative–the members. Further, in the true concept of sharing, democratic decision making allows the opinions of the different people sharing to be expressed on an equal basis (Uber, Lyft and others essentially present the terms of service to the workers and either they accept or quit working for them). Any surplus generated from the cooperative sharing economy gets distributed according to the inputs into the enterprise.

One thing that Taskmaster, Favor Delivery, Lyft, et al have pointed out is that a market exists for connecting people with others. This can and should be done in a cooperative format that doesn’t exploit the people providing the labor.Dane County Timebank has made a start, but seems to come up short. This needs to be national, it needs to be modern (phone apps), it needs to engage more than bartering. I realize that Timebank seeks to demonetize society as a key part of its mission–it is all about getting off of the currency addiction. Unfortunately, for many working people, money comes in pretty handy. Landlords don’t accept barter and neither do health clinics, gas stations, and a host of other places that provide vital goods and services. Until they do, a “sharing economy” needs to provide the means for people to earn a decent a living and maintain a quality of life.

Cooperatives need to reclaim the concept of the “sharing economy”. We need to help people struggling to find work, make ends meet, and otherwise seek their dreams understand that they don’t have to rent out their bodies and everything they own (is their a site where someone who likes parenting, but doesn’t want the hassle of a full-time kid, rent somebodies child for an afternoon?). Cooperatives (worker, consumer, producer and financial) need to challenge these profiteers by helping people combine their resources to create dynamic cooperatives that can provide the things that the “sharing” apps provide which is essentially services for people who need them.

There is also a role for labor unions. SEIU, CWA, USW have all been engaging worker cooperatives of late. This “new” economy offer them a real opportunity as well. Through the creation of a “union coop” of drivers, they could help Uber and Lyft workers negotiate better terms. This would be similar to the Campbell’s union drive in which Campbells’ claimed the farmworker’s conditions weren’t their responsibility since Campbell’s only contracted with the farmers and didn’t employ the farmworkers. Unions could also organize the “favor” workers to negotiate better terms. There really isn’t anything new in the “sharing economy” model, but it needs a response.

Sharing constitutes the basis of cooperative life and economics. As cooperators, we share our labor, our capital and our knowledge with each other to create a resilient and sustainable economy and environment. Over the years, many times, the selfish economy have borrowed our ideas to advance their personal goals. Today, the investor class corrupts the very concept of being a good neighbor by using the noble concept of community to extract wealth in a one-way relationship. Cooperatives have always offered an alternative to the selfish economy but have generally operated under the radar. We need to stop doing that. We need to quit being the world’s best kept secret. We need to claim the “sharing economy” as the “cooperative economy”.

August 14, 2014

There is a new blog about worker cooperatives entitled“Owning a Better Future”. The focus of this blog, judging from the first couple of posts, will center on the growing “union coop” model. This model engages both traditional labor unions and worker cooperatives. The author, Rob Witherall, works for the US Steelworkers and has been a big part of the collaboration between than union and Mondragon.

Part of building the worker cooperative movement in the United States involves building our visibility. We need more of us to get our message out as best we can. We need a discussion about where the labor movement is heading.

August 11, 2014

Last May, I had the opportunity to attend the Canadian Association for Study in Cooperatives. It was held at Brock University as part of the annual Congress of Social Studies and Humanities Research Council. There were, as usual, a number of exciting and fantastic papers matched only by the lively and open discussions.

Perhaps one of the most fascinating presentations was work by Isobel Findlay from the Edwards School of Business at the University of Saskatchewan. I always enjoy her presentations as her work almost always examines how cooperatives can benefit and re-power the most marginalized populations in Western economics and culture. This presentation was no different as it considered the potential for worker cooperatives within the prison industry. This model would membership institutionalized women and provide them with the means to assist in the support of their families and maintaining a level of dignity during incarceration. It would also provide knowledge, skills and abilities that would be useful upon release.

People in the United States often see Canada as a euro-centric country that is “nice” and “pleasant’. Yet, far too often, it takes after the United States and its growing prison population is no exception. Canada’s prison population has increased 25% over the last ten years and the population of prisoners deemed “visible” minorities” has increased 75% (http://www.cbc.ca/news/canada-s-prison-population-at-all-time-high-1.2440039). Findlay also noted that Aboriginal women make up the fastest growing population with an 85% growth rate. She argued that “Marginality is too often a life sentence that takes the form of invisibility or hyper visibility. Over-policed and under-protected, it will cost Saskatchewan $13 billion over the next twenty years that could be used for better things.” She continued that if all citizens were truly treated equally (and by this I would understand that the incarceration rate for all groups would be equal to that of white men and women), it would bring $90 billion to the economy over this same time period.

Prison worker coops exist in other countries (mostly Italy) where those who participate have significantly lower recidivism rates. In one (and artist cooperative), one member said that “it made me realize that there are still people out there who appreciate who I am.” In Puerto Rico, there are three men’s worker coops and plans to start a women’s coop. Members learn the values and ethics of cooperation especially that of mutual self-help. It is clear that they also gain self-worth and confidence that they can succeed. These coops allow the workers to earn a wage that can be used to support their family and keep those connections strong.

Worker coops could create the support structures that the prison system currently fails to provide especially once people are out although this might require some amendments to laws that provide felons from associating with one another.

Findlay noted that this research is difficult because it challenges the command and control of the prison system and she noted that the “state” bristles when academics “commit sociology.” Nevertheless, it seems that the coop model could provide a means for true rehabilitation. I realize that has long ceased to be the focus of the prison system especially for those areas where it has been privatized and the inmates turned into product for the benefit of shareholders and for-profit corporations. However, as people can show that cooperation does more than simply provide a paycheck, society’s rulers might see a real community value to changing how we treat all members of our community.

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June 30, 2014

In a narrow ruling, the Supreme Court ruled (5-4) that requiring “partial public employees” did not have to pay union dues. This case revolved around home care workers who clients pay them through Medicaid or Medical Assistance. This case had the potential to be much wider. Many feared that the Roberts’ Court would effectively overturn previous decisions and wipe-out requirements that non-members pay dues. Still, this decision does roll back the power of unions and in some states significantly hurts their financial standing.

This is a difficult case to think about because it involves home care workers who run the gamut of traditional employee working for a corporation to family members quitting their jobs to care for a parent. It is hard to imagine the justice in depending a cut of the meager Medicaid stipend given to a son or daughter who is providing 24 hour care for their parent. At the same time, a number of care workers also work solely with non-related private clients paid in cash that may indirectly come through medicaid or partially covered by medicaid. Of course, care workers for non-unionized firms who also receive medicaid for payment do not have to pay union dues.

This decision by the court and the minority opinion highlight the changing definitions of “worker” and “employee” in contemporary society. Until today, I have never heard the term “partial public employee” but I imagine we will be hearing it a lot now and expect that range to start growing as states start imagining ways of externalizing their costs onto workers. The notion of “the worker” is changing and is becoming quite muddled. In some cases workers are entrepreneurs in others strict employees. This makes the work of organizing workers frustrating and exciting. May we live in interesting times!

While this may be confusing for those of us in the cooperative community, it is a clear threat for those organizations strictly regulated under the National Labor Relations Act or State labor relations acts. For labor unions, ruling such as this will only complicate their job. As more workers get redefined as “partial publics” expect that fight to grow on how to organize this group.

June 2, 2014

Over the last couple weeks, cooperators across North America have been meeting and discussing the state of cooperatives and the future. I’ve been fortunate to have been involved in a number of those discussions. Despite the geographical, sectorial, and ideological diversity, a couple of common themes ran through all of the discussions. As I start to filter through the presentations and key notes, I will share with you what I heard and how I heard it.

Visibility

Time and again, we discussed in Canada and the United States that we need to build our “movement”. We need to be a bigger part of the economy. The oft-quoted number of “1 billion members” by the International Cooperative Community sounds great, but ignores the multiple memberships that people hold (for example, I am a member of four credit unions, a worker cooperative, two consumers cooperatives, a developer’s cooperative, and the US Federation of Worker Cooperatives. I was recently a member of a healthcare cooperative. I represent 10 of those 1 billion people).

More importantly, we allow our message to be usurped by others. Cooperatives are the original sharing economy. Today, investor-owned tech companies operating on purely neo-liberal principles have managed to co-opt that idea to make profit by using other people’s capital and labor. We need to reclaim what a “sharing economy” really looks like. It shouldn’t be a person sharing their labor and capital to a tech firm so that the tech firm can take a 20-30% share of the revenue. It should be an organization where all the members share their capital and labor and equally share the surplus value that they create.

The cooperatives that do exist, need to be more visible. They need to make noise. They need to let their local, state and federal elected officials know who they are and tell their sotry. This has to be a part of the expression of the 7th Principle of “Concern for Community”. They also need to engage the “cooperation among cooperatives” in a meaningful way by helping to grow the Federation through membership and promoting sustaining memberships among their members, diverting funds towards the Worker Ownership Fund, and providing resources to the Federation to assist getting the message out.

Impact

Enhancing our visibility must involve measuring our impact on the community. We need to be able to show how a worker owned business does more than provide a decent wage. It builds resilience within the community by developing leadership, educating people, and creating added value for all the stakeholders, not just the members. This may mean developing skills in members that allow them to successfully serve of community boards and committes, it may mean working to create strong and vibrant neighborhoods, and it may mean building local and regional alliances as needed to create sustainable economies built around social justice.

Growth

It was pointed out that worker cooperatives, even at a high estimate, represent about 0.03% of the businesses in the United States. To get traction, we need more worker cooperatives. We need to stop seeing growth as a problem. Rather our cooperatives need to address the demand for our goods and services. We should be happy that consumers like the goods and services produced by worker cooperatives. This doesn’t mean a wild expansion of individual coops to the point that the community is lost and democracy reduced to electoral politics. As we scale up our businesses to meet the demand of consumers, we must also scale up our governance models to meed the demand of the cooperative principles and our members right to a truly participatory democratic workplace. A nine-member board that works for a hundred members may not be enough for a three hundred member coop, let alone a thousand member coop.

More than Money

We must commit to being about social justice and creating a world based on our values, ethics and principles. If we are only about creating jobs with decent pay and benefit, then our success will be illusory and subject to the whims of a marketplace in which our businesses will eventually succumb to the downward pressure on wages and benefits that is built into the investor-based market economy. As the Rev. Martin Luther King jr. is often quoted as saying, “we must be the change that we want to see.” Arizmendiaretta also saw the role of the cooperative as a means of assisting people to their full realization as a human beings (perhaps-riffing off of the movie Little Big Man–that is the real term that we should use instead of worker-owners or members).

These four themes were present and actively discussed and debated at all three conferences that I attended (in three different cities and two countries) between May 22 and June 1). We clearly acquired a lot of energy from the Year of the Cooperative in 2012, and that energy is pumping through our organinzations. We need to harness it. The ICA has called for creating the Cooperative Decade. This must happen or we will watch this energy siphon off to who knows where. For it to happen, we need to begin using it now, today, in our coopertives, our cooperative organizations, our local networks and community organizations and with our policy makers at all levels.

I hope you join me as I start writing up my notes form the conferences. I have always wanted this site to be a discussion, not just my musings and rants. You are welcome to submit your own posts (just let me know and I will give you access). We need a national discussion that is outside of the annual conferences or only among a small group of people.

May 28, 2014

Last week I attended the Tools to Measure Performance and Impact at St. Mary’s University in Halifax. The conference was part of a several year research CURA known as the Measuring the Cooperative Difference. Part of my role with this group involves reporting out of the conference–this will be done by the end of June in time for the ICA Research Committee’s conference in Croatia.

The central question and scope of the work has been to find viable measurement tools for cooperatives and credit unions that specifically address the nature of cooperatives as democratic social enterprises. Using standard data such as debt/equity ratios and return on equity may tell us how coops fare when compared to the investor owned businesses, but they don’t tell us how coops are doing as coops.

Vancity Credit Union in British Columbia found the need to create new measures since they invest in what might be called the “real economy”. When using data around local investments in actual businesses (not artificial constructs such as the derivatives of 2008 fame), credit unions tend to out-perform banks. They are part of the Global Alliance for Banking on Values (GOBV).

One of the speakers from Cooperatives America, argued that we need to stop using tools designed for capitalist market economy and create tools for the social market economy. Others argued that we in the cooperative community should quit trying to compare ourselves to the investor -owned competitors, and start presenting ourselves as the model and let the investor-owned organizations compare themselves to us and justify their existence. It was a bit of a feisty crowd for Canadian academics!

In all seriousness though, a number of incredible tools have been created to measure cooperatives as sustainable and resilient organizations. That last bit is important as one of the presentations presented the harsh realities of climate change and carbon in the atmosphere. It is unlikely that anything will stop humans from permanently altering the environment in a way that is quite negative for the species that have adapted for its current format. Today, as I post this, I see headlines that North America has hit the 400 ppm mark for carbon in the atmosphere (450 ppm is the “point of no return” mark). It is unlikely that coops can scale up to a point to reverse this trend, but we can be there for the aftermath.

The tools being developed now will be able to assist us in tracking our success and helping to point the way forward. It won’t be on the maximize profit model, but on the maximize community model. Over the next several posts I will discuss some of the models.

I am currently at the Canadian Association for Study in Cooperatives (CASC). It is being held at Brock University (just west of Niagara Falls) and named for Isaac Brock the Canadian general who gave his life repelling the US army when they attempted to invade Canada during the War of 1812. More to come!

May 19, 2014

This is a just a heads up to those who still check-in here occasionally that that it will pick up a bit over the next couple of weeks. I will be attending not one, not two but three cooperative conferences over the next two weeks.

The second conference is the Canadian Association for the Study in Co-operatives at St. Catherine’s (Brock University). I’ve gone to this incredible conference several times, but this will be my first trip since 2011. I’ve previously blogged about it on my other site: http://rochdale.livejournal.com/tag/casc.

So stay tuned! I will be reporting as live as possible from all three conferences with write ups of the sessions that I attend and news. For those of you who are also attending any of these conferences, consider signing up with this web site and joining on with your observations.

March 10, 2014

This weekend I noticed a posting from a friend, colleague and mentor of mine: Tom Webb. He had found an old write up called The Things We Know. I am not sure of the source of this document, but if it comes from Tom, it probably has a rich history within the Canadian Maritime Cooperative Movement. I am sharing it today, but will spend the next few weeks, discussing each bullit point in more detail. So tune in, comment, and let’s have a great discussion about our coops (warts and all).

The successful cooperatives of the world are those that have grown out of the efforts and determination of the people themselves. It is not enough that coops be for the people, they must be of and by them as well.

The best coops are those that had dedicated and courageous leaders either in the very beginning or in their early) history

The capital created within the working of the cooperative is vastly more important than the financial resources of the members in the beginning

Coops make their best contribution to human welfare and social progress when they initiate policies and practices different from those of old line businesses

There comes a time in the development of every cooperative enterprise when it must have managerial ability of a high order

Coops that stand for something more than financial gains have amazing powers of survival in times of stress and difficulty

Coops that isolate themselves from other coops and refuse to join the bigger cooperative movement tend to shrivel up and die

Coops can withstand prolonged attacks from without, but they can’t survive weak or dishonest leadership within

Too much aid from government or paternalism of any kind will blight cooperative effort

Cooperatives with weak leadership resist change

There is no type business too big or difficult for the cooperative way

Too rigid a structure in organizational set up is a serious obstacle to progress in cooperative development, especially in a period of rapid change

Coops in which control narrows down to fewer and fewer hands tend to behave more and more like old line capitalism

It so happens that I am reading The Citizen’s Share (Blasi, Freeman and Kruse) right now. This book chronicles the varied and rich history of worker ownership in the United States from the earliest days of the revolution until today. It notes that 47% of US businesses have some sort of worker ownership from the 100% owned companies named above to Google and Microsoft in which all workers have the opportunity to participate in the risk of the company (apparently Bill Gates’ ownership stake is now only 6% of the company he founded). The message of the day was to discuss the importance of worker ownership as a sustainable model for economic growth in the United States.

I enjoyed this group and the approach. Too often, the concept of sustainable business only gets used to discuss environmental issues such as climate change. The plight of modern day employees tends to be ignored. This allows organizations engaged in Union busting tactics to present themselves as good corporate citizens. I would argue that sustainability (both for the climate and the economy) can only occur if workers are treated well and get a share of the pie that they create.

ASBC’s role is to bring together the worker owned businesses and unite the ownership movement. One of the problems is that there are some bad actors that use the image of worker ownership without providing the benefits to the workers. This is not unique to our country, but the lack of Federal understanding of worker ownership and a corporation laws that vary from state to state make it difficult to understand when workers really benefit from worker ownership.

For example, the US government clearly recognizes ESOP, but has no understanding or definition for a worker cooperative. The USDA recognizes Producer Coops and this language tends to be used by the IRS to determine if a business is a cooperative for federal tax purposes. ESOP really aren’t a type of business as much as they are a retirement plan. That is an important distinction between and ESOP and worker cooperative (and an area where the two concepts could create a lot of synergy). Ass’t Secretary Borzoi remained skeptical from her experience policing ESOPs that have used the structure to evade the Fair Labor Standards Act, but was impressed with the group at the table.

In January, we began a discussion with the Federal Government about worker ownership in the modern economy. It was clear to all of us (at least in the practitioner world), that the Wagner model of industrial relations has become outdated. We need new rules and definitions that help guide a national economy in which cooperatives and ESOPs operate across state lines (thus triggering Federal oversight) and engage in worker ownership and control of the workplace. We need to create laws that address a large workplace in which the workers really control the means of production through a one-worker, one-vote method (regardless of the type of organization). We, in the coop world, also need to strengthen the social definition of worker cooperatives (promote the CICOPA Oslo Declaration) and raise our profile. We can’t and shouldn’t be constrained by the legal definitions of the individual states. A democratically run ESOP with 100% worker ownership (even with workers having different shares of ownership) is as much a cooperative as Ch. 185 coop in Wisconsin with only 60% of its workers as members.

My only disappointment was that we did not meet with any GOP connected staffers. I truly believe that our movement is non-partisan and resounds with all of the political parties in this country (major and minor). If we are building a big tent, it will be necessary to look beyond party labels.